ONEOK Inc., Tulsa, Okla., has agreed to acquire Brazos Midstream's Permian Midland basin natural gas gathering and processing assets for $4.425 billion, more than doubling its Midland basin processing capacity and creating one of the region's largest integrated natural gas gathering and processing systems.

To fund the transaction, Apollo and affiliates will make a $9-billion nonvoting minority equity investment in ONEOK, which plans to use about $5 billion of the proceeds to reduce debt.

"The acquisition expands our scale in the Permian Midland [b]asin, advances our integrated wellhead-to-water strategy and strengthens connectivity across our natural gas and NGL value chain, positioning ONEOK to capture [major] volume growth in one of the most economic and rapidly growing resource plays," said Pierce H. Norton II, ONEOK president and chief executive officer.

The acquisition expands ONEOK's Permian footprint with assets supported by about 600,000 dedicated acres (about 4,000 remaining well locations and 14 active drilling rigs) under long-term, fixed-fee contracts and active development by producers including ExxonMobil Corp., Diamondback Energy Inc., and Double Eagle, the company said in a release Aug. 30.

Following completion of the Cassidy II processing plant in third-quarter 2027, the Brazos system will include about 700 miles of gathering pipeline and 1.2 bcfd of processing capacity across seven core Midland basin counties. In Glasscock County, Tex., Cassidy II will double the Cassidy complex's processing capacity to 600 MMcfd, helping accommodate rising natural gas volumes from deeper Permian formations, Brazos Midstream said earlier this month. The acquisition also includes a basin-wide area of mutual interest with a private producer, providing additional opportunities for future growth, the company said.

ONEOK said the assets complement its existing Permian natural gas gathering and processing, NGL transportation, and crude oil infrastructure, bringing its Midland basin processing capacity to about 2.3 bcfd, including infrastructure under construction.

The acquisition is expected to increase volumes moving through ONEOK's downstream assets, including the West Texas NGL Pipeline and the Medford NGL fractionation plant under construction, while adding connectivity across the company's natural gas and NGL systems, the company said.

The Brazos Midland acquisition is expected to close in fourth-quarter 2026, subject to customary closing conditions. The Apollo investment is expected to close in September, also subject to customary closing conditions.